Independent Contractor vs Employee in Italy
How many times have you been wondering whether someone you have engaged with as a freelancer (or contractor) should be employed instead?
Almost every day our clients reach out to us with this question as they are not sure if they can compliantly use a service provided by an independent contractor (IC) in Italy and what is the risk associated with it.
To help you out, we want to share a simple questionnaire that we have created and we use each time we need to qualify an IC and determine whether that is a genuine independent working relationship or, rather, an employer-employee type of engagement.
Is hthe person employed by your Company or any other entity part of the Group?
Has the worker been employed by the Company or any other Entity part of the Group (if applicable) in the PAST?
Is this the first assignment offered to the worker by your Company? If not, please provide all the relevant information about start and end dates of any previous engagements including tasks and job description/s (this will help to understand if the previous engagements were of the same nature of not)
How long is the assignment / engagement for?
Will the worker be provided with company IT equipment? If so, please specify what exactly (I.e., PC, mobile phone, home office equipment, etc.)
Is the worker going to use his own email address when communicating with external stakeholders or he/she will be using the company’s address? If both, which one will be used more often and for what purposes?
Is the worker going to report to someone within the organization or will he/she only be given a project / task to deliver / accomplish within a certain timeframe without any regular check done on his/her actions?
Is the worker going to be paid for his time off?
Will the worker independently choose his/her working pattern?
Will the worker independently choose his/her time off, or will she/he need to liaise with his line manager within your Organization?
Is the person also offering any other services to other Clients while working with your Company?
Has the worker signed any exclusivity and / or not compete covenants with your Organization? (Or will sign?). If so, what are the limitations imposed to the worker?
How frequently are you planning to remunerate the person?
Does the professional have an Italian tax number?
Is the professional currently registered as a freelancer or does he / she own an Italian registered company? Please provide more details if available
Answering these questions is only the first step of the process, as a proper vetting will also include a 30 minute interview with the client followed by a 30 minute call with the worker. When requested, we also perform a check on the company registration documents of the IC and we review the agreement between the client and the freelancer to make sure that both client and worker are taking the right preventative measures to have a compliant setup in Italy.